federal court system introduced in 1971; applies to all emirates except Dubayy (Dubai) and Ra´s al Khaymah, which are not fully integrated into the federal judicial system; all emirates have secular courts to adjudicate criminal, civil, and commercial matters and Islamic courts to review family and religious disputes

note: there is also a Federal Supreme Council (FSC) composed of the seven emirate rulers; the FSC is the highest constitutional authority in the UAE; establishes general policies and sanctions federal legislation; meets four times a year; Abu Zaby (Abu Dhabi) and Dubayy (Dubai) rulers have effective veto power

elections: president and vice president elected by the FSC for five-year terms (no term limits); election last held 3 November 2004 upon the death of the UAE´s Founding Father and first President ZAYID bin Sultan Al Nuhayyan (next to be held 2009); prime minister and deputy prime minister appointed by the president

election results: KHALIFA bin Zayid al-Nuhayyan elected president by a unanimous vote of the FSC; MUHAMMAD bin Rashid al-Maktum unanimously reaffirmed vice president

Legislative branch:

unicameral Federal National Council (FNC) or Majlis al-Ittihad al-Watani (40 seats; members appointed by the rulers of the constituent states to serve two-year terms)

elections: President KHALIFA in December 2005 announced that indirect elections would be held in early 2006 for half of the seats in the FNC; the other half would be filled by appointment

three equal horizontal bands of green (top), white, and black with a wider vertical red band on the hoist side

Economical information

Economy - overview:

The UAE has an open economy with a high per capita income and a sizable annual trade surplus. Its wealth is based on oil and gas output (about 30% of GDP), and the fortunes of the economy fluctuate with the prices of those commodities. Since the discovery of oil in the UAE more than 30 years ago, the UAE has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. At present levels of production, oil and gas reserves should last for more than 100 years. The government has increased spending on job creation and infrastructure expansion and is opening up its utilities to greater private sector involvement. Higher oil revenue, strong liquidity, and cheap credit in 2005 led to a surge in asset prices (shares and real estate) and consumer inflation. Any sharp correction to the UAE´s equity markets could damage investor and consumer sentiment and affect bank asset quality. In April 2004, the UAE signed a Trade and Investment Framework Agreement (TIFA) with Washington and in November 2004 agreed to undertake negotiations toward a Free Trade Agreement (FTA) with the US.

the United Arab Emirate 2006 Yearbook published a map and text rescinding the 1974 boundary with Saudi Arabia, as stipulated in a treaty filed with the UN in 1993, on the grounds that the agreement was not formally ratified; boundary agreement was signed and ratified with Oman in 2003 for entire border, including Oman´s Musandam Peninsula and Al Madhah enclaves, but contents of the agreement and maps showing the alignment have not been published; Iran and UAE dispute Tunb Islands and Abu Musa Island, which Iran occupies

Illicit drugs:

the UAE is a drug transshipment point for traffickers given its proximity to Southwest Asian drug producing countries; the UAE´s position as a major financial center makes it vulnerable to money laundering; anti-money-laundering controls improving, but informal banking remains unregulated

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